Brexit isn’t a binary equation for Scotland’s bold tech entrepreneurs

Shaun Millican

Shaun Millican

Business Advisory Partner

The summer recess is over, Parliament has re-convened and the topic of Brexit is back on the front pages. However despite a few months having passed since the UK voted to leave the EU, there still remains a vast number of imponderables making it no easier to predict where all this might end up.

In recent years Scotland, and Edinburgh in particular, has seen a boom in the presence of tech start-ups and entrepreneurs with an insatiable appetite for growth and success. Much has been written about the vibrancy of the sector but a number of factors came together in a virtuous circle to create an environment which nurtures and encourages start-ups and scale-ups: high levels of academic research activity, a growing talent pool, corporate activity and money (be it grant funding, angel investors or venture capitalists). 

Brexit has the potential to cause much disruption across these areas. The main risks could be:

  • A reduction in research funding for universities;
  • High quality talent is mobile and will go where the best opportunities are;
  • Corporates will want to ensure access to the single market;
  • Grant funding relies a lot on the EU so alternative schemes would be required.

In the short-term it is unlikely much will change but we could see a reduction in foreign investment and watch with keen interest to see how angel investors will react. Their other assets (e.g. pensions and stocks) may be impacted so will this reduce their propensity for investment?

These unchartered waters may refocus priorities such as the nurturing of home grown talent. Tech incubators like actively encourage peer-to-peer engagement, training and mentorship. Programmes such as Prewired - a club that teaches those aged 19 and under to code - does much to educate and embolden the techies of the future.

Should we also place more faith in Scotland’s robust innovation infrastructure? Universities and innovation labs were designed to encourage collaboration and partnering opportunities between companies who operate in an array of sectors. Established partnerships may well weather the Brexit storm. As a key sector for Scotland the hope is that whatever the post-Brexit landscape looks like, these activities are protected and enhanced. 

Finally this sector is built on a strong entrepreneurial spirit. While some may refocus priorities and take pause for thought, many others will see new opportunities and won’t be afraid to take the plunge.

In this current climate our attitude firmly remains ‘business as usual’. Talk to us about future project opportunities; we can help you consider alternative sources of funding and what areas to prioritize.